The KOSPI plunged nearly 20% from the beginning of the year as concerns over an economic slowdown caused by a rapid rate hike increased.
According to the Korea Exchange, the KOSPI fell by -5.97% and the KOSDAQ weekly decline by -8.18% for the week from 13th to 17th, which started with 'Black Monday' on the 13th and collapsed to 2,400 during the intraday on the 17th.
The KOSPI weekly decline was the second highest this year since January 24-28 (-6.03%), and the KOSDAQ weekly decline was the largest in two years and four months since February 24-28 (-8.57%) on February 24, 2020.
Since the beginning of the year, there has been a sharp decline due to concerns about austerity from the US Federal Reserve, and recently the US raised interest rates by 0.75 percentage points at a time, raising the possibility of an economic recession.
Compared to the beginning of the year, the KOSPI fell 18.02% from 2,977.65 at the end of last year to 2,440.93 on the 17th of this month, and the KOSDAQ fell 22.76% from 1,033.98 to 798.69.
Equity experts expect a technical rebound, but expect a second downtrend in the fourth quarter as concerns about an economic downturn escalate.
Seo Sang-young, head of Mirae Asset Securities' Media Contents Division, said, "As central banks in each country accelerate austerity, the market is estimating the worst-case scenario that the economy will go into recession, and the stock market decline is growing. are being hit more,” he explained.
“Since 2008, the de facto zero interest rate and unlimited quantitative easing have been completely reversed,” said Jeong Myung-ji, head of Samsung Securities’ investment information team. said.
However, he said, "The stock market may decline the most annually since 2008 (on an annual basis), but considering the sharp rise in the past two years, it is difficult to see it as a crisis as high as the financial crisis."
After falling 40.73% in 2008, the KOSPI rose 49.65% in 2009 and 21.88% in 2010 the following year.
(Photo = Yonhap News)